Investors in cash are getting a negative return after inflation, making equities look more attractive. Despite some dissension in the Federal Reserve ranks, Fed Chairman Ben Bernanke has pledged to hold the federal funds rate near zero as long as inflation doesn't top 2.5% and unemployment remains above 6.5%, reassuring investors that the party won't stop anytime soon.3. The housing sector has been a bright spot. The housing sector is still acting as a tailwind for the overall economy. Sales of new houses are up to 2008 levels and existing housing stock is shrinking, feeding the trend. The manufacturing sector is showing improvement across industries and new orders were up in February for the second month in a row. 4. Price-to-Earnings ratios are still relatively low with respect to historic values. PE ratios are one of the ways we evaluate whether a stock is overvalued. The chart below shows historic PE ratios using reported earnings for the trailing 12-month period (TTM) of the S&P 500 from 1900 to today. The PE ratio on March 11 (calculated using the last official EPS data from 2012) was just shy of 18, only a couple of points above the historical mean of 15.49.